Olivine Capital v Lee Chiew Leong: Compromise Agreement & Liability for Negligence in Construction Project
Olivine Capital Pte Ltd and Ong Puay Guan @ Steven Ong appealed against the decision to strike out their action against Chia Chin Yan. The plaintiffs had sued Chia Chin Yan and Lee Chiew Leong for breach of duty and negligence related to a construction project where a sewer pipe was damaged. Chia Chin Yan applied to strike out the action based on a compromise letter, which the Assistant Registrar granted. The High Court dismissed the appeal, finding that the compromise letter effectively released Chia Chin Yan from liability. The plaintiffs' appeal was dismissed with costs.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal Dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Appeal regarding a compromise agreement's effect on liability for negligence in a construction project. The court dismissed the appeal.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Olivine Capital Pte Ltd | Plaintiff, Appellant | Corporation | Appeal Dismissed | Lost | |
| Ong Puay Guan @ Steven Ong | Plaintiff, Appellant | Individual | Appeal Dismissed | Lost | |
| Chia Chin Yan | Defendant, Respondent | Individual | Claim Dismissed | Won | |
| Lee Chiew Leong | Defendant | Individual |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Lai Siu Chiu | J | Yes |
4. Counsels
4. Facts
- Olivine Capital Pte Ltd engaged Lee Chiew Leong and Chia Chin Yan as architect and professional engineer for a construction project.
- A sewer pipe was damaged during piling work at the construction site.
- The Public Utilities Board (PUB) invoiced Olivine Capital Pte Ltd for the cost of repairing the damaged sewer.
- Chia Chin Yan resigned from his roles and signed a compromise letter with Olivine Capital Pte Ltd.
- Olivine Capital Pte Ltd sued Lee Chiew Leong and Chia Chin Yan for breach of duty and negligence.
- Chia Chin Yan applied to strike out the action based on the compromise letter.
5. Formal Citations
- Olivine Capital Pte Ltd and another v Lee Chiew Leong and another, Suit No 762 of 2012/W (Registrar's Appeal No 125 of 2013), [2013] SGHC 168
6. Timeline
| Date | Event |
|---|---|
| Olivine Capital Pte Ltd engaged Lee Chiew Leong and Chia Chin Yan as architect and professional engineer of the Project respectively. | |
| Relevant statutory approvals for the Project were obtained. | |
| An underground sewer pipe was damaged while piling work was being carried out at the Site. | |
| The Public Utilities Board became aware of the damaged sewer. | |
| The Public Utilities Board gave notice to Olivine Capital Pte Ltd and Chia Chin Yan to restore the damaged sewer. | |
| Olivine Capital Pte Ltd informed the Public Utilities Board that it would not do the repair work and requested that PUB carry out the same. | |
| The Public Utilities Board informed Olivine Capital Pte Ltd that the estimated cost of the repair work was $600,000. | |
| Olivine Capital Pte Ltd informed the two defendants and the piling contractor that they were holding the three parties liable for the repair costs. | |
| The Public Utilities Board invoiced Olivine Capital Pte Ltd $512,939.18 for the cost and expenses it had incurred in repairing the sewer. | |
| Olivine Capital Pte Ltd appointed HPC Builders Pte Ltd for the Project. | |
| Chia Chin Yan took on the roles of architect and project coordination of the Project, in addition to his initial role as the professional engineer. | |
| Chia Chin Yan was charged with an offence under s 14(1) of the Sewerage and Drainage Act (Cap 294, 2001 Rev Ed). | |
| Chia Chin Yan resigned from his roles as professional engineer, architect and project coordinator of the project and gave the second plaintiff a letter to sign. | |
| The Public Utilities Board charged Ong Puay Guan @ Steven Ong and Lee Chiew Leong with offences under ss 14 and 20 of the Sewerage and Drainage Act (Cap 294, 2001 Rev Ed). | |
| Olivine Capital Pte Ltd and Ong Puay Guan @ Steven Ong instituted this suit against Lee Chiew Leong and Chia Chin Yan for breach of duty and negligence. | |
| Chia Chin Yan filed the Application, seeking a determination under O 14 r 12 of the Rules of Court. | |
| The Appeal came on for hearing before Lai Siu Chiu J. | |
| Lai Siu Chiu J dismissed the Appeal. | |
| The appeal to this decision in Civil Appeal No 86 of 2013 was allowed by the Court of Appeal. |
7. Legal Issues
- Breach of Duty
- Outcome: The court found that the compromise letter released the second defendant from liability for breach of duty.
- Category: Substantive
- Negligence
- Outcome: The court found that the compromise letter released the second defendant from liability for negligence.
- Category: Substantive
- Contractual Interpretation
- Outcome: The court interpreted the compromise letter to release the second defendant from all claims, including those related to the damaged sewer.
- Category: Substantive
- Related Cases:
- [2008] 3 SLR(R) 1029
8. Remedies Sought
- Indemnity for compensation payable to the PUB
- Losses suffered as a result of the damage to the sewer
9. Cause of Actions
- Breach of Duty
- Negligence
10. Practice Areas
- Commercial Litigation
- Construction Law
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Zurich Insurance (Singapore) Pte Ltd v B-Gold Interior Design and Construction Pte Ltd | Court of Appeal | Yes | [2008] 3 SLR(R) 1029 | Singapore | Cited for the principle that extrinsic evidence is admissible in aid of contractual interpretation, even if the contract is unambiguous on its face. |
| ANB v ANF | N/A | Yes | [2011] 2 SLR 1 | Singapore | Cited for the principle that summary determination under O 14 r 12 is not appropriate where there are factual disputes affecting the point of construction. |
| Re CEP Instruments Pte Ltd (in liquidation) | High Court | Yes | [2004] SGHC 206 | Singapore | Cited for the principle that summary determination under O 14 r 12 is not appropriate where there are factual disputes affecting the point of construction. |
| Goh Chok Tong v Chee Soon Juan | N/A | Yes | [2003] 3 SLR(R) 32 | Singapore | Cited for the principle that the court will not decline to make a determination under O 14 r 12 where the position taken by one party is so incredible that it is a sham. |
| Republic Airconditioning (S) Pte Ltd v Shinsung Eng Co Ltd (Singapore Branch) | N/A | Yes | [2012] 2 SLR 601 | Singapore | Cited for the principle that the court will not decline to make a determination under O 14 r 12 where the position taken by one party is so incredible that it is a sham. |
| Microsoft Corporation v Electro-Wide Limited | N/A | Yes | [1997] FSR 580 | N/A | Cited for the principle that the court must look at the complete account of events put forward by both the plaintiff and the defendants and look at the whole situation. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court (Cap 322, R 5, 2006 Rev Ed) O 14 r 12 |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) s 14(1) | Singapore |
| Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) ss 14 | Singapore |
| Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) ss 20 | Singapore |
| Sewerage and Drainage Act (Cap 294, 2001 Rev Ed) s 48 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Compromise Letter
- Sewer Damage
- Construction Project
- Breach of Duty
- Negligence
- Qualified Person
- Professional Engineer
- Architect
15.2 Keywords
- construction
- negligence
- compromise agreement
- sewer damage
- architect
- engineer
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Compromise Agreement | 80 |
| Contract Law | 70 |
| Breach of Contract | 60 |
| Construction Law | 50 |
| Negligence | 40 |
| Construction Project | 40 |
16. Subjects
- Construction Dispute
- Contract Law
- Negligence